[§323F-7.6]  Transition of Hawaiihealth systems regional system or health facility to a new entity.  (a)  Notwithstandingany other law to the contrary, including but not limited to section 27-1 andchapter 171, any of the regional systems or individual facilities of the Hawaiihealth systems corporation is hereby authorized to transition into a new legalentity in any form recognized under the laws of the State, including but notlimited to:

(1)  A nonprofit corporation;

(2)  A for-profit corporation;

(3)  A municipal facility;

(4)  A public benefit corporation; or

(5)  Any two or more of the entities in paragraphs (1)through (4).

A transition shall occur through the sale, lease, ortransfer of all or substantially all of the assets of the facility or regionalsystem, except for real property which shall only be transferred by lease.  Anytransition shall comply with chapter 323D.

(b)  A transition shall only occur uponapproval of the appropriate regional system board in the case of a regional systemor individual facility transition, or upon approval of the regional system boardsand the corporation in the case of the transition of the entire corporation. Any transition shall be subject to legal review by the attorney general whoshall approve the transition if satisfied that the transition conforms to allapplicable laws, subject to the review of the director of the department ofbudget and finance who shall approve the transition if it conforms to allapplicable financing procedures, and subject to the governor's approval.  Inaddition the transition shall be subject to the following terms and conditions:

(1)  All proceeds from the sale, lease, or transfer ofassets shall be used for health care services in the respective regional systemor facility, except that real property shall only be transferred by lease;

(2)  Any and all liabilities of a regional system orfacility transitioning into a new entity that were transferred to the Hawaiihealth systems corporation upon its creation by Act 262, Session Laws of Hawaii1996, and all liabilities of the regional system or facility related tocollective bargaining contracts negotiated by the State, shall become theresponsibility of the State; and

(3)  During the period of transition:

(A)  The State shall continue to fund theprovision of health care services provided for by the regional system orindividual facility; and

(B)  All applicable provisions of this chaptershall continue to apply.

Upon the completion of the transition of allthe facilities in a regional system to a new entity, the regional system boardfor that regional system shall terminate; provided that if not all of aregional system's facilities are transitioned to a new entity, the existingregional system board shall not terminate but shall continue to retainjurisdiction over those facilities remaining in the regional system. [L 2009, c182, pt of §8]